THE HIBERNIA SAVINGS BANK
1995 PREMIUM INCENTIVE STOCK OPTION PLAN
INCENTIVE STOCK OPTION AGREEMENT
Date:
FOR GOOD AND VALUABLE CONSIDERATION, receipt of which is hereby
acknowledged, THE HIBERNIA SAVINGS BANK, a Massachusetts corporation with its
principal place of business at 000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx
00000 (the"Bank"), hereby grants to:
(the "Optionee"), an Incentive Stock Option ("ISO"), within the meaning of
the provisions of Sections 421 and 422 (formerly 422A) of the Internal
Revenue Code of 1986, as amended, (the "Code") to purchase _____ shares of the
Bank's Common stock, $1.00 par value, ("Common Stock") upon the following
terms and conditions:
1. (a) This ISO is granted pursuant to the Bank's 1995 Premium
Incentive Stock Option Plan (the "Plan") and is subject to the terms and
conditions of the Plan, a copy of which is annexed hereto as Exhibit "A" and
hereby incorporated herein by reference.
(b) This ISO is intended to qualify as an "incentive stock option"
as the same is defined in Section 422 of the Code and this Agreement shall be
interpreted consistently with such intent.
(c) For the purposes of determining if an Optionee possesses, as of
the date hereof, more than ten (10%) of the total combined voting power of
all classes of stock of the Bank, an Optionee shall be deemed to possess the
stock owned directly or indirectly by or for his brothers and sisters (whether
by whole or half blood), spouse, ancestors and lineal descendants, and her
or his proportionate share as either a shareholder, partner or beneficiary of
the stock owned, directly or indirectly, by or for a corporation,
partnership, estate or trust.
(d) This option may be exercised only when the market price of the
Bank's common stock is at or above
2. This ISO shall not be transferable by the Optionee other than by
will or by the laws of descent and distribution and shall be exercisable by
the Optionee, during her or his lifetime, only by her or him.
3. (a) The price at which said shares of Common Stock may be purchased
pursuant to this ISO shall be (the "Purchase Price"), subject to adjustment
as provided in PARAGRAPH 3(b) hereof, said Purchase Price being not less than
one hundred (100%) percent of the fair market value of such stock on the date
hereof, or not less than one hundred ten (110%) percent of the fair market
value of such stock on the date hereof if the Optionee possesses, as of the
date hereof, more than ten (10%) percent of the total combined voting power
of all classes of stock of the Bank, or its parent or its subsidiary
corporations. Fair market value shall be determined in good faith by the Board
of Directors of the Bank (the "Board of Directors").
(b) If at any time after the date hereof but prior to an exercise
of this ISO there shall occur (i) any subdivision or combination of the
Bank's outstanding Common Stock, by reclassification or otherwise; (ii) the
payment of any Common Stock dividend, or (iii) any other capital adjustment
effected without receipt of consideration from another entity that in the
discretion of the Board of Directors may require adjustment; then at the time
of such occurrence, the number of shares subject to this option and the price
per share set forth in PARAGRAPH 3(a) hereof shall be proportionately
adjusted. Any fractional shares resulting from the computation of such
adjustment shall be eliminated from this ISO.
(c) The Purchase Price shall by payable in cash or by check
acceptable to the Bank. The Bank may not directly or indirectly make any loan
to the Optionee for the purpose of assisting her or him to acquire any shares
issuable upon the exercise of any ISO granted to her or him under the Plan.
4. (a) This ISO must be exercised, if at all, before the expiration of
ten (10) years from the date hereof, provided that, in the event that the
Optionee possesses,as of the date hereof, more than ten (10%) percent of the
total combined voting power of all classes of stock of the Bank, this ISO
must be exercised before the expiration of five (5) years from the date
hereof.
(b) Subject to the provisions hereinafter set forth, this ISO may
not be exercised by the Optionee prior to 12 months from the date of this
Agreement.
(c) This ISO may not be exercised as to any shares whatsoever
(except as provided in PARAGRAPHS 4(d) AND 4(e)
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herein) unless at all times during the period beginning on the date hereof
and ending on the day three (3) months before the date of exercise, the
Optionee was an employee of the Bank, its parent, or its subsidiary
corporation, or of a corporation (or its parent or subsidiary) issuing or
assuming a stock option in a transaction to which Section 424(a) (formerly
425(a)) of the Code applies; except that, in the case of an Optionee who is
disabled within the meaning of Section 105(d)(4) of the Code, the three (3)
month period referred to above shall be one (1) year.
(d) If employment of the Optionee is terminated by the Bank for
cause, this ISO shall terminate immediately. If the Optionee's employment
ceases by reason of her or his voluntary resignation and acceptance thereof
by the board of Directors of under circumstances in which the Board of
Directors deems immediate termination of this ISO to be inequitable, the
Optionee may exercise this ISO to the extent that she or he was entitled to
exercise it on the date of such cessation of employment, during the three (3)
months immediately succeeding such cessation of employment, provided such
exercise is in no event made later than ten (10) years from the date hereof,
or five (5) years from the date hereof in the case of an Optionee who
possesses, as of the date hereof, more than ten (10%) percent of the total
combined voting power of all classes of stock of the Bank, its parent, or its
subsidiary corporations, if any. Whether an authorized leave of absence or
absence on military or government service constitutes a termination of
employment for the purposes of this ISO shall be determined by the Board of
Directors. Nothing in this ISO shall confer upon the Optionee any right with
respect to continuation of employment by the Bank or interfere in any way
with the Bank's right to terminate the Optionee's employment.
(e) In the event that the Optionee dies while this ISO would
otherwise be exercisable by her or him, this ISO may be exercised for a
period of twelve (12) months from the date of death by the person or persons
designated in the Optionee's Will for that purpose or, if no such person is
designated or the Optionee dies intestate, by her or his personal
representative or representatives. Notwithstanding the foregoing, this ISO
may in no event by exercised later than ten (10) years (five (5) years if the
Optionee possesses, as of the date hereof, more than ten (10%) percent of the
total combined voting power of all classes of stock of the Bank, its parent
or subsidiary corporations) from the date hereof and may, at the time of its
exercise, only be exercised to the extent that the Optionee was entitled to
exercise it on the date of her or his death.
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(f) This ISO shall be exercisable by, and only by, serving written
notice of the exercise upon the Bank, marked attention "Chief Executive
Officer," at its office at 000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000,
accompanied by payment in full of the Purchase Price in accordance with
PARAGRAPH 3 hereof. This ISO may not be exercised for a fraction of a share.
(g) The Optionee shall have none of the rights of a stockholder
with respect to any shares subject to this ISO until such shares have been
issued by the Bank.
5. Subject to any required action by the stockholders of the Bank, if
the Bank is a party to any merger or consolidation, any unexercised portion
of this ISO shall, in lieu of the number of shares of Common Stock covered by
such unexercised portion, pertain and apply to the number and class or
classes of securities to which the Optionee would have been entitled under
the agreement of merger or consolidation if, immediately prior to such merger
or consolidation, the Optionee has been the holder of record of the number of
shares of Common Stock covered by such unexercised portion. If the Bank
dissolves or liquidates this ISO shall terminate.
6. (a) The benefits provided for in Section 421(a) of the Code shall
apply with respect to the transfer by the Bank of any share of Common Stock
to the Optionee pursuant to the exercise or partial exercise of this ISO only
if no disposition of such share is made by the Optionee (i) within two (2)
years from the date hereof an (ii) within one (1) year after the transfer by
the Bank of such share to the Optionee. If a holder of any share of stock
acquired pursuant to the exercise or partial exercise of this ISO disposes of
said share before the expiration of these periods, she or he shall notify the
Bank of such disposition and the amount realized on such disposition.
(b) An ISO will not result in any taxable income to the Optionee
when it is granted or when it is timely exercised pursuant to PARAGRAPH 6(a).
If the stock acquired pursuant to this ISO is not disposed of either (i)
within two (2) years from the date hereof or (ii) within one (1) year of the
transfer of the stock to the Optionee, any gain on the sale of such stock
will be taxed at long-term capital gains rates. If, however, stock acquired
pursuant to this ISO is sold, exchanged, or otherwise disposed of before the
end of either of these holding periods, the Optionee will realize income at
the time of disposition in an amount not exceeding the lesser of (i) the
excess of the fair market value of the stock at the
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time of exercise over the Purchase Price or (ii) the excess of the amount
realized on the disposition of the stock over the Purchase Price.
7. This Agreement may be amended, altered or modified, only by a
written instrument signed by the parties hereto, or their respective
successors or assigns, and may not be otherwise terminated except as provided
herein.
8. Any notice, consent or demand required or committed to be given
under the provisions of this Agreement shall be in writing and shall be
signed by the party giving or making the same. If such notice, consent or
demand is mailed to a party hereto, it shall be sent by United States
certified mail, postage prepaid, addressed to such party's last known address
as shown on the records of the Bank. The date of such mailing shall be deemed
the date of notice, consent or demand.
9. This Agreement, and the rights of the parties hereunder, shall be
governed by and construed in accordance with the laws of the Commonwealth of
Massachusetts.
IN WITNESS WHEREOF, The Hibernia Savings Bank has caused this instrument to
be signed by its duly authorized officer and its corporate seal to be hereto
affixed.
THE HIBERNIA SAVINGS BANK
By:_______________________
TITLE:____________________
ACCEPTED:_____________________
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